LupineChemist

It just seems only a matter of time until there is a unified program and it's spun off to be its own business within IAG. I just hit IB Platinum and I actually see that as sort of an advantage as I fly BA to the US a fair amount and it would be nice to be included as an elite in what is the same corporation and same JV crossing the Atlantic. (Don't take our free parking at MAD, though!)

I am glad I just did a 200k avios redemption, though. And just a useful reminder that miles aren't meant to be saved.

Edit: I'd also love to have EI and VY properly integrated into status earning.

FlyerTalker688786

Yes you found a good point.

But for the result, I am not so sure if it is that solid compare to other companies. Look at slide 6 very carefully,
Ex-Fuel unite cost + 2.7%
(which means the Total Unit Cost is almost unchanged with -0.2% in constant FX terms and most of the saving is from fuel cost, which in term means the cost is actually up)
Both Unit Revenue are down. Even with ASK up 2.6% but pax unit revenue is down 1% (reported) or up 1.5% (constant FX), which shows capacity is exceeding demand thus PUR is under pressure.

LupineChemist

I'm wondering how much BA are willing to take a revenue hit at Gatwick in order to accelerate the decline of Norwegian.

Level appears to be doing well so it could be the Long Haul low cost model works, it's just Norwegian that is horribly managed. If they operate at a low margin to kill Norwegian (which has a solid balance sheet now, but unless they pull a miracle will start deteriorating very rapidly), that could be a very good strategy in the medium term.

Raffles

There will NEVER be another spin-off of a frequent flyer scheme after Aeroplan.

(ie Air Canada spun it off, took the cash and then terminated its contract with Aeroplan - reducings its value to nil, effectively - and announced it was relaunching its own scheme. Apart from the fact that no investor would trust such a spin off again, Aer Canada's reasons for doing it are the reasons you don't sell - eg Air Canada did not even know who was a member of its 'own' frequent flyer scheme, was not allowed to issue its own co-brand credit cards etc.)

LupineChemist

I mean its own business unit within IAG. I'm thinking of FlyingBlue and M&M rather than Aeroplan. The other two of the European big 3 already have a system like that so it just seems like low hanging fruit to me to lower overall costs with lots of synergies of running various programs.

rockflyertalk

Dave_C

One of analysts did ask about NPS. Alex Cruz took the answer with a load of waffle, but the phrase he used was it was "evolving positively". Make of that what you will.

FlyerTalker688786

I would like to point out several points in your post that i disagree with.
1, Norwegian is not horribly managed. Yes Norwegian has its own problem, which is the mantra of expansion at any cost. The expansion is too fast which is reflecting badly on its financial statement. But the core business is well managed and passengers are generally satisfied with its service. Mismanagement? Yes, from the miscalculated expansion plan. Horribly managed? I think I would dispute this statement as Norwegian itself is a fine airline so far.
2, Is Level 'successful'? Ok I would like to dispute this by calling for IAG to publish full financial statement of Level. But they can't. Why? Because until today (and to a certain point in future), Level will continue use IB's aircraft, maintenance, back office etc. in order to maintain operation. Without the unconditioned support of IB, Level could not go into operation 'one year earlier than planned [quote from IAG result presentation]'. So far, we know Level carried more than 170,000 passengers (pls check the figure as it is on top of my head from the IAG result so this could be wrong) at a ticket price of roughly €150-300 each (judging by sales). So we could say the total revenue is around €35-50 million for 2017. I would put it to lower end since most of the passengers are likely to buy separate one-way ticket rather than return. Is this the prove of Level being successful or failure? I think neither of us can come to a conclusion based on public available information. However, one thing is for sure, without IB's subsidy, Level would bleed money like almost all low cost start ups at the developing stage. The capital required to establish a long haul airline would certainly require the founder to put aside more than €50 million. So far Level is IAG's defence towards the expansion of other long haul low cost airlines. It is not designed to be a market leader. It is there to be a shield.
3, Regardless whether people like Ryanair or Norwegian or not. The reality is that customers need choices and need market disrupters in order to have the best deals. The likes of EasyJet, Ryanair and Norwegian put legacies' pricing power on check so that all customers can benefits from a competitive pricing situation. I certainly wish the best for Norwegian so that we can continue enjoy lower fares on the likes of BA and AA. Monopoly is bad, cartel is bad, a world with only 3 alliances serving Atlantic routes is especially horrible. You could love BA or IAG unconditionally, but please be realistic when you want to bash another airline.

And that is my 2 pennies.

lost_in_translation

This is a reasonably large earnings miss, with share price down c.6% today. Not a terrible set of results and IAG will no doubt persevere with the current strategy unchanged, but effectively little/no growth in BA with group growth being driven by the other operating units. Look forward to reading in more detail tonight.

I note that RASK/PRASK continue the spiral downward, however.

Raffles

BApilotinsider

Sealink

So on the slides it said that some BA growth was fuelled by... Philadelphia. That will be the return of a second flight from LHR this summer then?
I suppose an extra flight is a lot of capacity...

LupineChemist

Remember the JV. AA expansion from PHL to Europe is BA expansion.

Sealink

Of course, apprecitate the clarification. I did see 4 daily flights between the two this summer.
Just in Philly now, and love it. It's like New York only friendlier and smaller.

DYKWIA

I bet you've got the bunting and baloons at the ready.